Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

[Rajiv]

Health Insurers enjoy record-breaking profits

Insurers enjoy record-breaking profits as they cut 2.7 million people from their rolls

Health Care for America Now has a new report out today on the insurance industry’s profits and customer base [pdf] and the statistics are shocking:

The five largest U.S. health insurance companies sailed through the worst economic downturn since the Great Depression to set new industry profit records in 2009, a feat accomplished by leaving behind 2.7 million americans who had been inprivate health plans. For customers who kept their benefits, the insurers raised rates and cost-sharing,and cut the share of premiums spent on medical care. Executives and shareholders of the five biggest for-profit health insurers, UnitedHealthGroup inc., WellPoint inc., Aetna Inc., Humana Inc., and Cigna Corp., enjoyed combined profit of $12.2 billion in 2009, up 56 percent from the previous year. It was the best year ever for Big Insurance.
…
The 2009 financial reports from the nation’s five largest insurance companies reveal that:

• The firms made $12.2 billion, an increase of $4.4 billion, or 56 percent, from 2008.
  • Four out of the five companies saw earnings increases, with CIGNA’s profits jumping 346 percent.
  
  
• The companies provided private insurance coverage to 2.7 million fewer people than the year before.
  • Four out of the five companies insured fewer people through private coverage. UnitedHealth alone insured 1.7 million fewer people through employer-based or individual coverage.
  • All but one of the five companies increased the number of people they covered through public insurance programs (Medicaid, CHIP and Medicare). UnitedHealth added 680,000 people in public plans.
  
  
• The proportion of premium dollars spent on health care expenses went down for three of the five firms, with higher proportions going to administrative expenses and profits.The numbers may be shocking, but they shouldn’t be surprising. This is how the industry makes money, by charging people more and cutting the unprofitable people from their rolls. In fact, the one company who’s profit margin went down slightly this year – Aetna – was also the only company to add more customers to its rolls in 2009.

But the industry will go to any length to "justify" their profits and their policies of dropping their sick or expensive customers.

First, they’ll claim that the cost of medical care is going up, and so they need to raise prices, but it’s simply not true. As Congresswoman Rose DeLaura (D-CT) pointed out on a call with reporters announcing this report:

They’ll say the increases are justified because medical care is going up, and they’ll hide behind their actuaries to explain their rate increases. But this is coming from the same people who’ve been saying health insurance reform will increase costs. They can’t have it both ways.

She’s absolutely right. Insurance costs are skyrocketing now. Double-digit rate increases like those announced from Anthem in California have been common for years, and will continue to be "commonplace" if we don’t reform our health care system, according to Richard Kirsch, Health Care for America Now’s National Campaign Director. And yet, while raising their rates, insurers claim health reform will increase prices. It seems there’s only one way prices can go in according to the insurance industry – up.
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[BuckarooBanzai]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

I agree with you.

Tonight my wife and I had dinner at a fine Mexican restaurant with another couple. The husband is a barber who cut his middle finger so badly at Thanksgiving that he had to go to the hospital later that day.

They cleaned the wound and glued it to closure. Then a doctor came in to look at it - no sutures were placed.
His bill from the hospital was $1,190.00 and the physician charged him $600.00 !!!:eek:

He wasn't making this up. We have a real problem but I'm not sure how to fix it.

The problem is insurance. Health care is NOT AN INSURABLE RISK.

All forms of health care insurance MUST BE ELIMINATED. This includes both PRIVATE and PUBLIC (i.e. "single payer") insurance.

When all medical care is priced on a cash-only, a la carte basis, prices for everything will come crashing down to earth.

[Thailandnotes]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

I agree with you.

Tonight my wife and I had dinner at a fine Mexican restaurant with another couple. The husband is a barber who cut his middle finger so badly at Thanksgiving that he had to go to the hospital later that day.

They cleaned the wound and glued it to closure. Then a doctor came in to look at it - no sutures were placed.
His bill from the hospital was $1,190.00 and the physician charged him $600.00 !!!:eek:

He wasn't making this up. We have a real problem but I'm not sure how to fix it.

This morning I was bending a piece of metal for a sculpture. It slipped loose and stabbed me in the leg. Six stitches, antibiotics, tetanus shot.

110 dollars. On the way home, I said to my wife, "I wonder how much that would have cost in the States."

"No idea. Over a thousand, I'm sure."

[Rajiv]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

Your prescription is to the most extent correct. However, one of the main problems with healthcare is that healthcare costs are asymmetric in time. Costs are high in pregnancy and early childhood, followed by a lull, and increase as the human being ages.

For the first part of the above costs, your suggestions would work, as these occur at the peak earning capacities of the young family. Aging care costs are complicated by two factors -- one, the human desire to live, and two the inability of humans to save at a rate that keeps up with inflation.

Human life in old age has been prolonged by interventions that are often expensive, or often kept to be so to maintain profitability. It is in this composite of societally complex obligations that we live, and as the shape of the population pyramid changes, we have to come up with solutions that do not unduly overburden the younger generations to take care of the elders.

[flintlock]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

I cut the tip of my finger off today at work( just a sliver). Some gauze and tape, peroxide, problem fixed. But how many would go to the emergency room for this if they knew insurance would cover most of it?

[Jay]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

I cut the tip of my finger off today at work( just a sliver). Some gauze and tape, peroxide, problem fixed. But how many would go to the emergency room for this if they knew insurance would cover most of it?

Many go for much less, take an ambulance to get there, and ask for a hot meal and a cab voucher to go home.

Try super glue. Works great for most cuts, just clean them first with a lot of tap water.

[flintlock]

Re: Let Them Eat Cake: The Anomaly Of Compulsory Private Health Insurance

Thanks, I'll try that.

[Ghent12]

Re: Health Insurers enjoy record-breaking profits

The five largest U.S. health insurance companies sailed through the worst economic downturn since the Great Depression to set new industry profit records in 2009...

The CEO's deserve some really big bonuses for maximizing profits. However, since they were unable to finalize the "health insurance reform" coming from their paid Congressmen, they should not get the types of bonuses that were enjoyed by the financial firms who actually got work done in the Capitol. Now those "people" truly deserved those insane bonuses, having successfully bought all relevant aspects of the government.